by Apparel Resources
14-March-2019 | 9 mins read
Vietnam’s apparel and textile sector dates back to centuries but it was only in the late fifties that the world started witnessing the country – especially the northern part – making some development in its garment and textile industry. Nam Dinh, which is in the northern region of the country, has been traditionally a garment hub with lot of factories being built by French colonists. The province used to be associated with quality apparel products in its heydays.
The glorious days of Nam Dinh’s garment and textile sector, however, saw a slump in 1990s with the increase in salaries and increasing competition from other centres in Vietnam. During the French occupation, the Nam Dinh Textile Plant, which was operated by the Nam Dinh Garment Corporation, was the largest textile plant of Indo-China. It was a time when the factory employed over 18,000 workers – amounting to one-tenth of the local population.
However, over the last few years, the number of workers in the plant has come down to a paltry 5,000 with many of them leaving due to low wages. Nothing can explain the slump better than these shocking numbers. Debts and environmental agencies labelling the unit as an environmental threat, have today almost languished the factory.
Nam Dinh is today home to nearly 480 textile firms with more than 70,000 workers. Though the numbers may be debatable, one cannot deny that the industry accounts for nearly 40 per cent of Nam Dinh’s overall industrial production value. “Post-2000, Nam Dinh has been coming up again though it is yet to regain the old glory mainly because of the scarcity of the workers,” averred Long Vu, Material Sales Manager, Youngone Corporation.
There have been improvements since last decade and a half, but as Long said, the province still faces shortage of workers. On same lines, Thomas Tran, Vietnam and Cambodia Sales, Inkcups Now Corporation, said, “If garment manufacturers would set up big factories in Nam Dinh, then their biggest concern will definitely be the lack of labour resources.” He further said that Thai Binh province, which is near to Nam Dinh, on the other hand, has stronger labour resources and more attractive Government policies. Therefore, the new city coming up at Thai Binh could be the potential winner.
Greg Fleming, Director of Merchandising, Worlds Preeminent Green Sustainable Jeans Mfg, has a different take on the re-emergence of Nam Dinh. He added that the workers available in the province are quality workers who are adept at making all apparels. “Apart from skilled workers, Nam Dinh offers easy transportation, close proximity to Haiphong Port and, most importantly, well-managed industrial parks,” substantiated Greg, who has been in Vietnam for over five years.
Industrial parks in Nam Dinh have indeed managed to garner decent attention over the last few years, be it the Rang Dong Industrial Park or the Bao Minh Industrial Park. The Rang Dong Industrial Park intends to lure more investors to the garment and textile sector and has set a goal of one billion metres of fabric by 2020 and 1.5 billion metres by 2025. This would also mean creation of jobs for over 60,000 people.
It doesn’t end there. To adhere to environmental laws and regulations, the park will soon see a wastewater treatment station coming up, which has a capacity of 1,10,000 cubic metres of water per day. Rang Dong Industrial Park is expected to meet the demand of fabric for Vietnam’s garment and textile sector. In addition to the growing industrial parks, many factories in Nam Dinh have a skilled team of professionals to meet the demands of the customers. “I know most of the factories have outstanding industry experts to manage the production. This apart, the factories have handloom for sampling so as to meet every requirement of the customer on time. There are also free apartments for the workers. There couldn’t be anything better to attract the workers,” said Trung Quan, Leader at Yarn Process, Decathlon Vietnam.
In October, Bao Minh Industrial Park in Nam Dinh saw the official opening of Bao Minh Textile JSC. The factory also ran a trial run where it displayed its ability to make 30 million metres of fabrics and 7,200 tonnes of yarn annually. Equipped with latest machines, it is one of the largest manufacturers of woven fabric in North Vietnam. Made at an investment of US $ 75.2 million, the factory may soon be one of the most significant contributors to Vietnam’s supply of garment materials.
South Korea’s TCE denim mill, located in the Hoa Xa Industrial Park (Nam Dinh), has been the pride of the province. Proximity to Hanoi International Airport and Haiphong Port has helped TCE further strengthen its position of having the biggest denim fabric mill in Vietnam. In 2017, Hoa Xa Industrial Park also saw Danish apparel manufacturer Spectre open its second textile factory worth US $ 5 million. With 100 per cent capital investment from Spectre A/S, Denmark, the entire output produced by the factory is exported to European countries.
Corroborating on the above, Jesper Klausen, Chairman, Spectre Nam Dinh, averred, “Nam Dinh province could meet most of the company requirements like accessible transport and skilled workforce and we now plan to invest more in the factory so as to deepen the manufacturing scale of exported goods.” Some of Spectre’s major product lines are sportswear tailored for rock-climbing, running, jogging, cycling and bow-hunting.
Additionally, the Europe-Vietnam Free Trade Agreement (EVFTA), which may come into effect anytime soon, will continue supporting trade growth apart from highlighting the competitiveness of Spectre’s future products. The company is known for making fleece jackets, softshell jackets and technical T-shirts.
Toray Industries, Inc., a renowned Japanese apparel and textile group, is also all set to open its first fibre plant in Nam Dinh province. This was announced by Mitsuo Ohya, Senior Vice President, Toray Industries, Inc., in Hanoi on 14 January 2019 in a meeting with Tran Tuan Anh, Minister of Industry and Trade. Mitsuo Ohya added that the fibre plant is expected to be made on an investment of US $ 184.4 million.
Singapore’s Herberton Ltd. recently carried out the Nam Dinh Ramatex Textile and Garment Factory project worth US $ 80 million in Nam Dinh. The factory, which is all set to go operational in 2019, has a capacity of producing 25,000 tonnes of fabrics and 15 million apparel items annually, thereby creating job opportunities for nearly 3,000 workers. And, with lot of companies investing in the social and economic welfare of its employees, Nam Dinh may attract good number of workforce in good time.
The garment industries are definitely moving over to Nam Dinh though at a very slow pace but the feel is positive and if the Government of Vietnam too works on policies favourable for the province, the day is not far when Nam Dinh starts living its old days of glory.